How student loan repayments work
UK student loan repayments behave like a tax on income above a threshold, not like a normal loan. You repay 9% of everything you earn above your plan's threshold (6% for Postgraduate Loans), and nothing at all below it. The balance and the interest rate never change the monthly amount, only how long you keep paying.
The 2026/27 thresholds are:
- Plan 1: £26,900 (started before September 2012 in England or Wales, or any year in Northern Ireland)
- Plan 2: £29,385 (England or Wales, September 2012 to July 2023)
- Plan 4: £33,795 (Scotland)
- Plan 5: £25,000 (England, from August 2023)
- Postgraduate Loan: £21,000, at 6%
Worked examples
Which plan you are on
Your plan is set by where you lived when you applied and when your course started, not by where you live now. English and Welsh students who started before September 2012 are on Plan 1, those who started between September 2012 and July 2023 are on Plan 2, and English students starting from August 2023 are on Plan 5. Scottish students are on Plan 4 and Northern Irish students on Plan 1. Master's and doctoral loans in England and Wales are a separate Postgraduate Loan, repaid at 6% alongside any undergraduate plan. If you are not sure, your online account at gov.uk confirms it.
When the loan disappears
Any balance left at the end of the repayment term is written off automatically. Plan 1 loans are wiped 25 years after the April you were first due to repay (age 65 for the earliest loans), Plan 2, Plan 4 and Postgraduate Loans after 30 years, and Plan 5 after 40 years. That write-off is why overpaying is not automatically sensible: many graduates on Plan 2 will never clear the balance before it is wiped, so voluntary extra payments can simply be money lost. Whether overpaying helps depends on your salary trajectory and balance. This page is guidance, not financial advice; the official rules live at gov.uk/repaying-your-student-loan.
Frequently asked questions
Which student loan plan am I on?
It depends on where you lived and when you started. Plan 1: England or Wales before September 2012, or Northern Ireland any year. Plan 2: England or Wales from September 2012 to July 2023. Plan 4: Scotland. Plan 5: England from August 2023. Postgraduate Loans are separate and cover master's and doctoral study in England and Wales.
When is my student loan written off?
Plan 1 loans are written off 25 years after the April you were first due to repay (or at age 65 for the earliest loans). Plan 2 and Plan 4 loans are written off after 30 years, and Postgraduate Loans after 30 years too. Plan 5 loans last longest, written off 40 years after the April you were first due to repay.
Why is the deduction on my payslip slightly different?
Payroll works out student loan deductions per pay period, not annually, and rounds each deduction down to a whole pound. Bonuses or overtime in a single month can also push that month's pay over the monthly threshold even if your annual salary is below it. This calculator shows the annual picture.
Do I repay undergraduate and postgraduate loans at the same time?
Yes. If you have both, the two repayments run side by side: 9% of income above your undergraduate plan threshold plus 6% of income above the £21,000 postgraduate threshold. Tick the postgraduate box in the calculator to see the combined total.
Does the interest rate change what I repay each month?
No. Repayments depend only on your income and your plan's threshold, so a higher interest rate never raises your monthly payment. Interest changes how fast the balance grows and therefore how long you repay, and whether you clear the loan before it is written off.